France Considers Giving Entire iGaming Market to FDJ

Posted on: December 5, 2023, 06:58h. 

Last updated on: December 9, 2023, 03:16h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

In his Gaming & Co newsletter on Substack a few days ago, long-time gaming industry journalist Jake Pollard said that gaming operator Française des Jeux (FDJ) could be given the entire online casino market.

A sign outside a store for French gaming and lottery operator Française des Jeux.
A sign outside a store for French gaming and lottery operator Française des Jeux. There may be a plan to give it exclusivity over France’s iGaming market. (Image: Sepa Press)

Insiders informed Gaming & Co that discussions are underway between FDJ and the authorities in France regarding a potential draft iGaming regulation. If the rumor is accurate (neither FDJ nor the government has offered input), this regulation could pave the way for FDJ to control the online gaming sector.

Over the past few months, France has been leading parliamentary debates on the regulation of Jonum. An acronym for the French translation of “games with monetizable digital objects,” it’s a design for a legislative framework that would include Web3 and blockchain gaming regulations.

The French Association of Online Gaming (AFJEL, for its French acronym) and industry union Casinos de France (CdF) have taken leading roles in the discussions. They submitted various amendments to shape their vision for a regulated casino sector.

What the Rumors Say

While AFJEL proposed a competitive regulation for online casinos, CdF suggested allowing only physical casinos during a three-year experimental period. Meanwhile, according to Pollard, FDJ may have used this time to develop its project while assessing the proposals from AFJEL and CdF.

Rumors suggest that FDJ might launch its online gaming operations in February. This would coincide with the European Commission’s anticipated examination of France’s SREN law, which includes the Jonum legislation.

Pollard asserts that the French government hasn’t shown any intention to regulate online casinos. But that’s not entirely accurate. Earlier this year, the government began superficially discussing a plan allowing land-based casino operators to enter the iGaming space.

They would have received a five-year head start, with only the licensed brick-and-mortar operators allowed to launch online platforms during that time. The bill hasn’t made significant progress but hasn’t died.

Ulterior Motives

It’s possible that France would support the initiative because of the revenue it would automatically earn. FDJ was a state-run operator before the government took it public, retaining approximately 25% of the company.

France’s gambling market was worth €12.9 billion (US$13.95 billion) in gross gaming revenue (GGR) last year, of which FDJ controls about 10%. While it has witnessed a revenue drop this year, the sector is still in great shape.

Controlling the iGaming segment would allow FDJ to provide the government with a larger, steady revenue stream. The government will receive even more if France fulfills its plans to block illegal gaming sites.

A report the French gaming regulator (ANJ, for its French acronym) released Monday shows that illegal gambling is big business in the country. A study by accounting and audit firm PwC asserts that more than 500 unlicensed websites are producing GGR of as much as €1.5 billion (US$1.62 billion) a year. Most hold licenses from either Curaçao or Cyprus.

The ANJ has repeatedly worked to block unlicensed gaming sites but is now going to step up its efforts. If it’s successful, the goal is for FDJ to start receiving the traffic. This, in turn, will increase the revenue the government picks up from the gaming industry.